Advantage and Disadvange of Running a Family Business
1181 Words5 Pages
Topic: Advantages and Disadvantages: Doing Business
The benefits of running of family business far outweigh the disadvantages. Relate this to your personal experience. Use specific examples and provide appropriate evidence to support your answer.
The definition of family business is a group of family members have controlling shares in a business (IFC Corporate Governance). Today, most family has their own company or factory. The family business across the world and continue to be more hopeful. The research shows that family businesses are positive in the future in next five years (PwC Family Business Survey, 2012). In this development of family business, running family business is profitable and confident about the future. Also my…show more content… In Muliez family, there 12% share is owned by the employees. Most of shares are owned by family members (Ajaero Tony Martins). Outsiders may work in a family business but won’t be a top management. Their ideas and skills cannot incorporated because of they are outsiders. Bill Gates said: 'The competition to hire the best will increase in the years ahead. Companies that give extra flexibility to their employees will have the edge in this area.’
Finally, the last disadvantage of running family business, family members are easier to be lazy. On the one hand, family members hold shares in company; they believe they would not lose this company. So it would lack of successful succession. Of course, this situation is not always happening. But when the stock is decreased, they shirk responsibility to each other. On the other hand, if the head of the family dies, this situation will be more serious. No one will go to lead them; but all of them want to be the head of the family business. They may not have ability to lead family business because of this lazy and shirk responsibility. A serious war will appear between family members. I think this is the biggest disadvantage of running family business.
In conclusion, there are three benefits and disadvantage of running a family business. Even there are many disadvantages in running a big family business. Although in running family business case, people can know each other better, company is lack of